(1) A director who votes for or who assents to a distribution made in violation of KRS 271B.6-400 or the articles of incorporation shall be personally liable to the corporation for the amount of the distribution that exceeds what could have been distributed without violating KRS 271B.6-400 or the articles of incorporation if it is established that he did not perform his duties in compliance with KRS 271B.8-300. In any proceeding commenced under this section, a director shall have all of the defenses ordinarily available to a director.
(2) A director held liable under subsection (1) of this section for an unlawful distribution shall be entitled to contribution:
(a) From every other director who could be held liable under subsection (1) of this section for the unlawful distribution; and
(b) From each shareholder for the amount the shareholder accepted knowing the distribution was made in violation of KRS 271B.6-400 or the articles of incorporation.
(3) A proceeding under this section shall be barred unless it is commenced within two
(2) years after the date on which the effect of the distribution was measured under subsection (5) or (7) of KRS 271B.6-400. Effective: January 1, 1989 History: Created 1988 Ky. Acts ch. 23, sec. 88, effective January 1, 1989.
Notes of Decisions
Cited in
5
cases (
1 in the last 5 years), 2009–2025 · leading case:
Wilson v. Paine, 288 S.W.3d 284 (Ky. 2009).
Wilson v. Paine, 288 S.W.3d 284 (Ky. 2009).
· cites it 10× “In Count Seven of his Complaint, Appellant alleged that unlawful distributions were made to various officers and directors pursuant to KRS § 271B.8-330. Appellant seeks to void those distributions on behalf of the corporation using Trustee’s equitable powers provided under the…”
Bank of Am., N.A. v. Corporex Companies, 99 F. Supp. 3d 708 (E.D. Ky. 2015).
· cites it 4× “25-1 at 15-16 (arguing that there is no relationship between any of the defendants and the Bank that would give rise to a fiduciary duty).”
Granite State Ins. Co. v. Taylor (W.D. Ky. 2025).
· cites it 4× “KRS 271B.8-330 and Standing Granite State seeks summary judgment on its claim that Defendants are personally liable as directors of Star Mine for improperly giving themselves a distribution when Star Mine could not pay its debts.”
John R. Wilson Tr. for Fcs v. David B. Paine (Ky. 2009).
· cites it 4× “Whether the equitable rule of adverse domination applies to toll the statute of limitations set forth in KRS §§ 271B.8-330(3) and 27113 .6-400? In certifying the question of law to this Court, the United States Bankruptcy Court for the Western District of Kentucky provided a…”
Wheatley v. McCarty (Bankr. W.D. Ky. 2020).
“120, the Trustee’s claims for failure to make required disposition, unjust enrichment, and turnover of property of the estate and are all subject to a five-year statute of limitations, and pursuant to KRS 271B.8-330(3), the statute of limitations for an improper shareholder…”
— Ky. Rev. Stat. § 271B.8-330(1) — 1 case
Bank of Am., N.A. v. Corporex Companies, 99 F. Supp. 3d 708 (E.D. Ky. 2015).
“25-1 at 15-16 (arguing that there is no relationship between any of the defendants and the Bank that would give rise to a fiduciary duty).”
— Ky. Rev. Stat. § 271B.8-330(3) — 4 cases
Wilson v. Paine, 288 S.W.3d 284 (Ky. 2009).
“In Count Seven of his Complaint, Appellant alleged that unlawful distributions were made to various officers and directors pursuant to KRS § 271B.8-330. Appellant seeks to void those distributions on behalf of the corporation using Trustee’s equitable powers provided under the…”
John R. Wilson Tr. for Fcs v. David B. Paine (Ky. 2009).
“Whether the equitable rule of adverse domination applies to toll the statute of limitations set forth in KRS §§ 271B.8-330(3) and 27113 .6-400? In certifying the question of law to this Court, the United States Bankruptcy Court for the Western District of Kentucky provided a…”
Wheatley v. McCarty (Bankr. W.D. Ky. 2020).
“120, the Trustee’s claims for failure to make required disposition, unjust enrichment, and turnover of property of the estate and are all subject to a five-year statute of limitations, and pursuant to KRS 271B.8-330(3), the statute of limitations for an improper shareholder…”
Granite State Ins. Co. v. Taylor (W.D. Ky. 2025).
“KRS 271B.8-330 and Standing Granite State seeks summary judgment on its claim that Defendants are personally liable as directors of Star Mine for improperly giving themselves a distribution when Star Mine could not pay its debts.”
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